Judge bars sales of RealNetworks' DVD software

[August 12, 2009]  SAN FRANCISCO (AP) -- DVD copying software sold by RealNetworks Inc. appears to be an illegal pirating tool, a federal judge ruled Tuesday in a legal battle that's been closely watched in Hollywood and elsewhere.

The Seattle-based company's RealDVD software violates federal anti-piracy law and also goes against a contract RealNetworks signed to gain keys to unscramble DVDs, U.S. District Court Judge Marilyn Hall Patel said.

DVDs are embedded with anti-piracy technology that prevents copying, Patel noted.

"RealDVD products are designed primarily for circumvention of that technology," she wrote. "This unauthorized access infringes the Studios' rights because it entails accessing content without the authority of the copyright owner."

Patel's order bars the company from selling its software until the case is resolved, saying the movie industry is likely to prevail in its legal battle with RealNetworks.

The company's software -- which costs $29.99 -- allows consumers to copy DVDs to their computer hard drives.

RealNetworks has argued that buyers of DVDs have a fundamental right to make digital copies for safer and more convenient storage. The company's lawyers said the software contains piracy protections that limits a DVD owner to making just one copy.

But the studios said they have the legal right to retain complete control over how content they've created is distributed.

The lawsuit has incurred widespread wrath from bloggers, digital rights advocates and groups on both sides of the political spectrum. Critics accuse the studios of stifling innovation.

The industry counters that it is trying to stamp out illegal piracy while it and partner companies develop legitimate copying software.

Patel initially barred sales of the software in October after the product was on the market for a few days. At the time, the judge said it appeared the software violated federal law against digital piracy, but ordered detailed court filings and a trial to better understand how RealDVD works.

The ruling was a big win for the industry and RealNetworks said it is considering its options. A trial has not been scheduled.

The industry feared an adverse ruling would legitimize so-called "rippers" -- software that allows users to "rent, rip and return" movies instead of buying them, thus cutting into Hollywood's annual $20 billion DVD sales market. Such software is easy to obtain online, though it remains illegal.

Patel, the judge who shut down Napster in 2000 because of copyright violations, essentially placed RealDVD in the same category as the music-swapping site on Tuesday.

"This is a victory for the creators and producers of motion pictures and television shows and for the rule of law in our digital economy," said Dan Glickman, chairman and chief executive of the Motion Picture Association of America. "We are committed to advancing the consumer experience through technology while sustaining the creative community that makes the movies and TV shows we love."

RealNetworks was disappointed with the injunction, but will review its options, company spokeswoman Kyrsa Dixon said.

[Associated Press; By PAUL ELIAS]

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